Transcript of the Episode

Mary Beth (00:14):

Hey there. Welcome to the If Money Were Easy podcast, the show where we teach you how to expand what’s possible with your money. We are your hosts, Mary Beth Storjohann –

Neela (00:23):

And Neela Hammel –

Mary Beth (00:25):

Certified Financial Planners and Co-CEOs of Abacus Wealth Partners. Today on the show we’re talking about how to financially transition from married to single life and not run out of money. But before we jump in, a brief disclosure from our Director of Compliance. This podcast is for educational purposes and is not intended as investment, legal, or tax advice. Any opinion shared is not an opinion of Abacus Wealth Partners. Let’s jump in.

Neela (00:52):

Joining us today is Lara Lamb. Lara Lamb is our in-house divorce expert and Certified Financial Planner who has been providing financial planning for over 20 years and specializing in divorce for the last seven. From 2009 to 2013, Lara owned her own financial planning firm before merging her practice with Abacus Wealth Partners. In addition to serving her clients, Lara is an Abacus partner, board member, and leader of the firm’s women’s initiative, the Abacus Sisterhood. Lara’s passion is to educate women and help them become confident with their money and achieve their financial goals. She is especially passionate about helping women going through a divorce in transitioning to the next phase in their life. Outside of Abacus, Lara has served as Director of Membership and President of the Financial Planning Association of Los Angeles. She has taught in CFP Board registered programs educating new planners entering the industry, and has presented in numerous financial literacy workshops. Lara is married with four children and enjoys fitness, hiking, camping, as well as reading. Welcome to this show Lara.

Mary Beth (01:56):

Welcome.

Lara (01:58):

Thank you. I am excited to be here.

Mary Beth (02:00):

Thanks for joining us today on such a really, really important and relevant topic I think for some of our listeners here.

Lara (02:08):

Definitely. Well, I’m glad to be here and share my knowledge.

Mary Beth (02:13):

So before we jump in, you know, in terms of financially transitioning from married to single life and the work and effort and emotions that go behind it all, can you tell us why this topic, why are you drawn to it? Where’d your passion come from?

Lara (02:27):

Well, I think as is the case for many people, personal experience. And so for myself personally, I went through my own divorce. The process started in 2013 and finalized in 2015. And in going through the process for myself, you know, it was fairly amicable, we hired a mediator, there wasn’t any knock-down-drag-out fighting thankfully. But being a certified financial planner and already having been in the industry and having the knowledge I had, we hired a mediator who did not really understand the financial aspects of divorce. And so he kept looking to me to make decisions or make recommendations as to what to do. And honestly I wanted to be fair, but I also didn’t wanna shoot myself in the foot and do something that maybe I wasn’t knowledgeable about how the finances of divorce worked. And so I actually hired a professional who focused in on this industry called a certified divorce financial analyst. I hired her to give me advice as to my own divorce and that I could take back to the mediator and my husband at the time in terms of how to structure the divorce. And so coming out of my own divorce, I realized how important this was to be getting financial planning advice during the divorce process to make sure that you were completely educated and knowledgeable about both the short-term and the long-term impact of many of these decisions. And so that was why I made the decision to pursue my own further education in this area and to get more training on the financials of divorce.

Mary Beth (04:19):

I love that walking the talk, hiring your own support system as opposed to going at it alone. I think just modeling that is so important and wonderful.

Neela (04:27):

It’s so incredible and I hope our listeners really take away what you just said because you are a certified financial planner. You do financial planning day in and day out. And then when you were encountering this situation in your personal life, it helped having outside help because there was a lot of new stuff that was coming. It’s a very unique planning situation and so you wanted to do the right thing. It sounds like with you and your ex that it was amicable but it needed to be fair. You’re like, am I asking the right questions? How is this gonna be? So I think that’s actually really powerful for a lot of our listeners who might be thinking about this that hey, you don’t have to know everything but know enough about when to get help.

Lara (05:08):

Exactly.

Mary Beth (05:09):

And I love modeling that you wanted to be fair, but you also didn’t wanna shoot yourself in the foot, that you wanted to make sure you were taking care of yourself as well. It’s hard for women to do that, to just advocate for ourselves and to make sure that we are looking after us because so often we end up putting everybody else first. So I love that you said that as well. Cause I think it’s really important, and I already know you know this Laura, but I think it’s huge with our clients and beyond going through transitioning through the divorce.

Lara (05:38):

100% because I think there are a couple other nuances to this situation. Number one, I was for a variety of reasons, the one requesting the divorce. So of course there’s some guilt associated with that. I’m the one pushing this process through and so I’m wanting to be fair but not bend over backwards fair, not hurt myself for the rest of my life. And there is so much nuance to divorce law that is different than traditional financial planning that if you’re in the midst of splitting assets, if you don’t know all of those ins and outs, you could do something wrong. And so again, just wanting to be fair, both for myself and also my ex and the kids, right? Because I had two kids from that marriage and so wanting to make sure that my ex had his financial house in order for the benefit of the kids but also that I had the same.

Neela (06:35):

So I know there’s a lot in this concept of divorce and you’ve talked a little bit in the past about different phases. Can you talk with us about what are the phases of divorce and what is associated with each of those phases?

Lara (06:49):

Oh sure. This is gonna be a big one.

Neela (06:53):

Of course.

Lara (06:54):

Because unfortunately sometimes too the whole process of divorce can take a long time and there’s very specific things that are going on emotionally and financially during each phase. So to start with, of course there’s the pre-divorce phase before anyone’s actually even filed anything official with the courts. So this is usually the Thinking About It Phase, whether you’re the person who might be initiating the divorce or maybe the conversations have started, maybe there’s been some conversations between you and a partner or between partners about the idea of separating the idea of divorce but nothing official has been done. Well there’s certainly a lot of information gathering that can and should be done during this phase to make sure that you are properly educated before you move on to the next phase. And that next phase is the During Divorce Phase. So the During Divorce Phase is once the papers have actually been filed with the court, certain things start to go into motion at that point and certain restrictions start to happen with financial assets at that point. And then you have the whole phase of figuring out what that final agreement is going to be for the divorce, which gets filed with the court and then the court approves the divorce. So now the divorce is final and now we move into the Post Divorce Phase, which is now your new life. What does this new life look like that is separate from what had happened before? So three very distinct phases.

Mary Beth (08:32):

So take us back to the thinking stage, thinking about it and we’ll assume that plenty of people spend months if not years in this stage. But what are the questions that you should be asking yourself and what is the information that one should be gathering during this stage?

Lara (08:50):

Definitely I think this is the stage that is really critical because this is hopefully going to give you the confidence in terms of moving on to the next phase, because I think that uncertainty of not knowing what it’s going to look like for yourself financially, physically, where are you gonna live? You know, I think there’s so much uncertainty that keeps people from moving on to the next stage. And so getting that information could lend itself to helping you take that step. So what’s involved with that? Well, I live in California. The advice that I generally give to clients is for clients who are California-based. So there’s certain laws here that are going to differ by state, but for instance, what is your state’s waiting period or what they also will call “cooling off” period. So for instance, in California it’s six months from the time you file for divorce with the court to the time that the court will approve it, so a minimum of six months in most cases and it’s often times longer. Many other states are much shorter. You can find some states with 30 days, 60 days. So you need to know what’s that cooling off period. The second part that you really want to be familiar with is what are the laws when it comes to property in your state? So again, in California, it’s community property. Community property basically means that everything that you and your partner earned prior to marriage is considered separate property. But everything from the point of marriage to the point of separation or divorce is considered community property, which means it’s all split 50/50. So whatever growth you have on assets, whatever assets you buy and they grow in value, any debt you create, any earnings, no matter what the disparity is between those earnings, it’s all 50/50. Now other states have different rules and that’s gonna end up meaning something different during divorce. The final thing that’s really good for you to figure out ahead of time is looking at what your budget is going to need to look like as you’re going through the divorce process, and then post divorce, and how any sort of support alimony or child support that you might receive or you might have to pay is going to play into that budget. So gathering that information, having that knowledge in order to know what it’s gonna look like going through the next steps.

Neela (11:11):

So it sounds like with this phase – you mentioned a lot of data gathering about your state of residence and also data gathering on your personal financial situation. So that’s a big piece which I love cause a lot of times it can sound scarier until we start uncovering everything and then at least you have better clarity. And then you’re really talking about this concept that I think is really interesting visualizing of, “Hey, this is gonna happen, okay, I’m gonna have this life post divorce, what could that look like? Where could that be? What would that entail?” And it’s almost like a, a starting of the next chapter in your own brain.

Lara (11:47):

100%. You know, obviously there’s a lot of emotions involved, there’s a huge change that’s happening to your family structure with your partnership with probably where you live and there’s a lot of emotions attached to that understandably. But at the same time, in order to get you to that next phase, knowing what it might look like as you move forward, that visualization, I think, is really helpful because then you can feel more confident as you’re going through the phase. And very similar to what we do with financial planning, right? We create this roadmap, we create this plan and it is a visualization of where you are going and what it’s gonna look like along the way. Well, reality happens and sometimes we deviate from that plan, but at least we kind of knew where we were heading so that as we make minor shifts along the way, we can still have that end in sight. And I think having that visualization during the divorce process is really helpful.

Mary Beth (12:44):

So for those that I guess we can call them innocent types or those that don’t have a hand in their day-to-day finances or maybe don’t play an active role in the finances of their households, how do you advise that they get started? Because it might just be completely new in terms of finding out where accounts are and understanding budgets and different items. And our listeners might be a little bit more actively involved in their finances if they’re – we are talking about money on this podcast – but how do you advise those who might have some shame and anxiety and fear around money or even being on their own? How do they get started?

Lara (13:19):

Definitely, I think there’s been a good number of people that I’ve worked with over the years who at the onset of the divorce were not involved in the day-to-day numbers and budgets and bill paying or investments. And I do think there was a lot of fear, anxiety, shame around not being more involved in this and being out of the loop. So if you’re getting started in this process, obviously if you start asking around and asking for statements and asking to download the data it might be a little suspicious–

Neela (13:52):

Lara (13:53):

Uh, that something’s going on.

Neela (13:55):

Pass the peas and uh, the financial statements. I mean…

Lara (14:00):

Can I have the online login information, right? Credit card statements. But I’m guessing if you’re at that point, maybe you’ve been having these conversations, otherwise you might have to kind of dig around. But ideally you are having these conversations and you’re able to get copies of statements. These are gonna be banking statements, credit card statements. Wonderful if you can aggregate the data into some sort of software like Mint.com, which is a wonderful place to just put your user IDs and passwords for all of your various financial institutions, it’ll actually grab some of the historical data so you can start to see some of the categorization of where the spending has been occurring. Now obviously if you’re in a partnership, some has been on your partner’s side and some has been on your side. So you have to start becoming a detective in terms of figuring out where has this spending been occurring. Obviously too, some of the expenses are fixed expenses meaning they’re probably allocated to household items, things like rent or mortgage or utilities or insurance. Now some of these things are gonna change if you’re gonna be changing households and moving somewhere else, but you can start to get an idea of where the money has been going and how much has been allocated to these different type of spending.

Mary Beth (15:21):

Yeah, in addition to Mint.com, I know You Need A Budget has been a great one as well that a lot of clients use. Mint is very reactive in telling you how you have spent your money and You Need A Budget is wonderful, in terms of going forward, how you can allocate your spending in the months ahead. So I think those are both really great resources to use with your finances.

Lara (15:41):

Agreed.

Neela (15:42):

Okay, so now we’re after phase one, we’ve gathered this information, now we’re in phase two, that is the going through the divorce process. What characterizes this phase and how can people really prepare to best deal with it?

Lara (15:57):

So this phase usually is kicked off by someone officially filing the paperwork with the court. In California, my understanding I believe is it’s a no fault state. You don’t have to have a reason for the divorce, you can just ask to get divorced. And so it doesn’t matter who’s the first one to file, maybe there’s some emotional attachment to that decision, but financially and court-wise it really doesn’t make a difference. So someone officially files. Now what that kicks off is the process of disclosure documentation when it comes to assets, liabilities, income expenses. So there’s some financial forms that are requested to be filed with the court on both sides and then it officially starts the process of how are you going to get the divorce. Now many people, especially with simpler cases, don’t ever hire an attorney, don’t ever go through mediation. They just come to an agreement between the two parties and they file it with the court. If you have more complexity, if you have kids involved, if you have more complex assets, if you have a house, usually these are reasons to get more professionals involved. I always recommend that clients hire a family law attorney even if it’s just to do a quick review of the final settlement agreement to just again, make sure that they’re not making any decisions that aren’t in their best interests. They aren’t giving away too much as part of the divorce. There isn’t something they didn’t realize that was important for them to know. So I always recommend that a family law attorney get hired. You don’t have to hire one that’s gonna fight tooth and nail and look to argue over every little decision just to make sure you’re not hurting yourself in the process. Usually at the time that the divorce is filed that also kicks off what are called temporary financial restraining orders. There’s an official term for it but I forgot it.

Neela (17:52):

That works. That sounds good. It’s a TFRO. It’s a TFRO for now.

Lara (17:56):

TFRO . What that means is from the point that that restraining order is in place on the assets, nobody’s allowed to move it around, pull out a chunk for themselves, change the beneficiaries on assets like retirement accounts, move it into someone else’s name, not allowed to do that stuff, because basically they’re saying this stuff is locked down until an agreement is come to and then the money can be moved around. So that kind of kicks off the during divorce process. Now the next phase is how are you gonna do it? Are you gonna hire family law attorneys, are you gonna go through mediation? Are you gonna do something called collaborative divorce? These are all different decisions that need to be made. Some of it is based off of how amicable is the divorce, how well can you and your partner work together as part of getting this divorce? Because for instance, with something like mediation, it’s the two of you and it’s the mediator and the three of you need to be coming to an agreement that you and your partner will agree on and be willing to file with the court.

Neela (19:05):

And going back to what you had said in terms of hiring your own advocate in the way of a CDFA, when you three are deciding not all assets are treated the same, you might have real estate, you might have retirement accounts, you might have any number of things, how do you know that you’re doing it right?

Lara (19:24):

So in particular when working with the mediator – so let me just describe this really quick. The mediator’s job is not to be on your side or not to make sure you are making the best decision for you. Their job is to get the two of you to agree. And so that does not mean that they’re going to come up with a completely fair and equitable agreement that is perfect for you. They’re just there to say, do you agree to this? Yes, great, let’s move on to the next thing. And this is why you need to have an advocate. And it’s also why I say everyone should have a family law attorney, but do you wanna be going to your family law attorney with every single decision and racking up that expense of having them check every single decision along the way? This is where hiring someone like a certified divorce financial analyst or someone who is educated in divorce financial planning can be such a good decision for you because you can have this person be on your side, they are your advocate, they are double checking that all of the decisions you’re making are not only in your short term but also your long-term financial interest. And I think that also gets to the point that the mediator and the family law attorney, they are not educated when it comes to financial planning and what decisions you’re making today, how that’s gonna affect your retirement, whether keeping the house is something that is really in your best financial interest for the long term, things like that. And so having an advocate on your side that can crunch those numbers and look at those things objectively with you is so critical.

Mary Beth (21:07):

Let’s actually talk about the house because I know that is a hot button issue, especially for those that are going through divorce and women with children having and keeping the primary residence, you’re right, mediator, attorney, they’re not interested in what that does to the long-term financial plan. But what have you seen, what should somebody be considering when they’re looking at the primary residence versus some of the other assets that are on the table?

Lara (21:31):

Such a huge decision and such an emotional decision. I mean it’s so hard because I think you’re exactly right that so often, especially when kids are involved, you have to not only have that transition of divorce, but then have that transition of moving also be involved – however many times you go to crunch the numbers – and it just does not make financial sense to be keeping that house both short-term and long-term. And there’s a couple reasons why the first one comes down to your normal monthly budget. What is coming in with income and what is going out with expenses? Can you actually afford to stay in that house in the short term or are you going to be underwater financially by trying to do that? Meaning that you have more expenses going out than you have income coming in and you really can’t afford it. And that’s a really tough decision to be facing. I have worked with clients where in some cases the decision was super clear, you can’t afford it, you’re gonna have to sell. And in some cases I’ve been able to work with clients where we’ve said you can have a transition period, you can have this transition period of staying in the house, having your kid or kids stay in the house, but at some point you will need to sell. And so maybe that’s after they graduate from high school, but just know in your mind that we’re gonna reach that point. Now that comes to the other critical decision or the factor that you have to be looking at, which is the tax impact of selling a house called capital gains. And the reason why this is so critical is that traditionally, normally in divorce, if someone decides to keep the house, any potential capital gains that might end up having to be paid someday do not get factored into the negotiation as part of keeping the house. So for instance, let’s just say that a house is worth $500,000 and you bought it for a hundred thousand dollars and someday if you were to sell it in the future, there would be some capital gains associated with it. I’ll just throw out a number of $50,000. That $50,000 number doesn’t get factored into the negotiation of I’m gonna have to pay this tax someday, therefore you should have to pay a piece of it or reimburse me for it. Now you don’t get to take that into consideration. So let’s say you were thinking I might have to sell in a year or two. It might be in your best financial interest to just sell now, split any capital gains tax payment between you and your partner, split any commission cost that has to be paid as part of the sale between you and your partner rather than have you pay all of it in a year or two. So these are really important factors that should be looked at, crunched and analyzed, looked at objectively. And then you can bring back in the emotions.

Mary Beth (24:26):

That’s not even considering, we’re also talking about refinancing the mortgage potentially.

Lara (24:30):

Potentially.

Mary Beth (24:32):

At higher interest rates.

Lara (24:33):

Exactly. Oh that’s a huge factor these days right now. Right. So in some cases I did work with a client where they were in a financial position where they could maintain the mortgage even though the ex continued to be on the mortgage. The ex agreed to stay on it in order for them to maintain the lower interest rate and they could still qualify given their income to get a second mortgage on a different house. In many cases that’s just not the case. In order for the partner not staying in the house to be able to move on financially and get another house or living situation, they gotta get off of that mortgage. And it could be that the spouse staying in the house doesn’t qualify even for a new mortgage. Maybe they haven’t been working, right, maybe they have no source of their own income or if they did have to refinance, the interest rate would be so high that it just wouldn’t make sense.

Neela (25:28):

That is such an important nugget that you hit on, is that you might have a million dollars between you and your spouse that you could easily say, well you take the house and I will take this cash account. Those are not the same because of taxes. So not all assets are treated the same when it comes to divorce. So let’s just make sure that we’re looking into the why and the taxes and really how it goes back to what you were saying with visualizing what your life is going to be like. Can it be in that house? And if it’s not gonna be in that house, well then what would it be? Would it be a different living arrangement in the same community? Could it be something completely different? And of course I know kids can make it even more challenging because then you’re looking at schools and shared custody, et cetera.

Lara (26:11):

Exactly, exactly. So many decisions that are affecting the short term and the long term for yourself. But you hit on such a great point when it came to taxes and all of the decisions that have to be made during the divorce process. And just wanna go back to that for a second because I think for some people the instinct is, where possible, let’s just split everything 50/50 or it might be you take the cash, I’ll take the retirement accounts for instance. You know there might be some global things to try to make it easier. But you have to dig into the specifics of the types of accounts that you’re dealing with. So for instance, cash is cash, but you might have retirement accounts where if you pull the money out today, number one, you may not be allowed to pull out the money today cause there might be some penalties associated with it. But let’s say you’re at retirement age, you go to pull the money out, you would have to pay income taxes on every dollar that you pull out. So it’s not worth the same. Now let’s say you take an account like a Roth where you pull out the money at retirement and you don’t have to pay taxes on the money that you pull out. That’s worth something different. That’s a whole ‘nother ball game.

Neela (27:24):

Oh, can we just have a moment to appreciate Roth accounts just right here, raise the roof on Roth accounts.

Lara (27:28):

Little cheering for the Roth. Yes, for sure. And then another category is an investment account that might be in your name, your partner’s name or held jointly. But you’ve made investments where there’s been some growth on the money and now there are some potential capital gains. If you sell those investments, those aren’t worth the same. So you really have to dig into the nuance of all of these different types of accounts, what the tax treatment is of them, any potential capital gain. It gets complex and I will tell you that your average run-of-the-mill, not to be offensive or anything, but your run-of-the-mill mediator and family law attorney don’t oftentimes understand the nuance of the taxes and they’ll just make these global recommendations that don’t often make sense for the individuals involved. Also comes down to personal need. If in the short term you’re gonna be getting back into the workforce and ramping back up your income and you need some more money in the short term, it might make sense to take some more of the cash in the short term and not worry about the IRAs for now, the retirement accounts, thinking that you’ll have to fund those in the future. So it all comes down to individual need and really looking at what you personally need.

Mary Beth (28:45):

So there is a lot to this. Your family dynamic is changing, your income dynamic is changing, your asset dynamic, your future looks different and there’s a lot of moving parts and pieces that I’m assuming and that I know through working with clients that causes a lot of stress and anxiety and shame and overwhelm. And so knowing all of this, if you’re staring down, somebody’s just getting started and you’re staring down all of this work ahead, what has been your experience in keeping clients on track or in the game and from that spiral, because it is a lot and it’s hugely emotional. So what have you seen that’s worked in terms of bringing peace of mind? Not that there’s a lot of it during this process, but how do you get clients to the other side and help them to see what it can be?

Lara (29:29):

I think one of the huge benefits of working with a financial planner during this process is that we really can create that visualization of what that future looks like. And I think that is so powerful compared to a family law attorney who’s only looking at the decisions today and what impact that’s gonna have this year. I think if you can create a plan around what is my future going to look like in two years, five years, 10 years in retirement and to know that all these decisions I’m making now are going to be helping me stay on that path for the future, I think that’s really powerful. The other piece too that I think is really helpful is that as you’re working with someone going through this really emotional, stressful process that, initially, try to pull back and to look at the numbers, to look at things objectively as much as possible. You know, say here’s what the situation looks like if you keep the house, here’s what the situation financially looks like if you don’t keep the house, we’re gonna compare these as best as possible apples to apples just with the numbers and now let’s go ahead and layer in the emotions cause they’re there and we need to acknowledge that they’re there and they’re a part of the decision-making process, but let’s try to start with the numbers and then we’ll go from there. And so I think both taking that longer-term perspective and then also trying to take as much as possible the emotions out of it initially and then go ahead and put ’em back in cause they’re there.

Mary Beth (31:05):

I love that. I know we say that all the time with planning, but what is your vision? What is your goal? And that’s what keeps us on track and drives us forward. It’s really powerful. So if you could give listeners who are considering this process one actionable takeaway, what would it be?

Lara (31:20):

I think for someone considering this, it’s really trying to wrap your arms around what is gonna look like for yourself personally. And to do that, honestly, if you hired a financial planner for a couple hours to just give you a snapshot of what it might look like during and post, just at a real high level, just to kind of give you the lay of the land. And part of this process will involve you doing your homework and pulling together some information, but I think that’s one of the most powerful things you could do for yourself in terms of knowing what that future is gonna look like.

Neela (32:01):

So good. Lara. I appreciate all of the detail and the emotional context because this is such a big lift and I feel like you’ve broken it down in a way where it’s like, okay, let’s gather this information, let’s bring on an independent team to make sure that you’re set up for success so that by the time you enter Phase Three, which is your new life, you can be done with these chapters. And then what’s next? You are on to that next phase. It’s super powerful to be like, okay, it’s tough and there’s a lot of stuff, but I can get through this. You’ve worked with many clients and you’ve ushered them onto the other side and I’m sure that’s rewarding.

Lara (32:39):

It’s so powerful. You know, I’ve worked with clients now even in the first phases of my financial planning career. I worked with many women just post divorce. They had just come to me at the very end of the divorce and they were looking very scared and nervous about what that future was going to look like for them. And now I’ve been working with them for 10, 15 years and I’m able to really see that confidence that has grown over time with knowing their financial situation. At the very beginning, they didn’t understand, they didn’t understand their investments, they didn’t understand their spending, and now they have that knowledge and more control over their own money. And to see the confidence that that brings is really a huge reason why I do what I do. It’s just so rewarding for me to see that confidence grow in the women that I work with.

Mary Beth (33:37):

Ah, you’re speaking to my heart.

Lara (33:38):

Mary Beth (33:40):

Okay, Lara, we’re gonna transition into our wrap-up questions. So what would you say is the best financial advice you have ever received?

Lara (33:51):

So this is one that I think a lot of people here – there’s a reason why it’s the best one for me. So it’s, it’s the obvious one: live within your means. But I think why it’s best for me is because it’s so hard to do for a lot of people. It’s so easy to not live within your means to overspend, you know, to not save enough or to put too much on credit cards. And why this was powerful for me is because then it led to me developing a budgeting system that not only has worked for me personally, but I’ve been able to share with so many clients when it comes to separating out your money into different buckets, into different accounts for different goals. And that not only helps control spending, but it helps make sure that cash is there for the non-monthly expenses. And so it’s an easy type of advice, but in implementation it can be harder. And this really led to something that has been a huge part of my career.

Neela (34:53):

Love that it’s like, you know, they say what’s the best budget? The one that you can stick to. That’s it. Yes, that’s the one . Sure. Yes.

Mary Beth (35:01):

The implementation is the hard part. I completely agree.

Lara (35:02):

That’s the hard part, the heavy lifting.

Neela (35:03):

All right, second question. What is your favorite money mistake that you’ve made and why?

Lara (35:11):

So me along with many, many other people, I’m sure I purchased my first home in 2003 and it was, it was a bit of a financial stretch at the time. And then given the timing of the housing market in Los Angeles home prices shot through the roof after 2003. And what happened then is we had a huge amount of equity and what did we do with that equity? Well, we tapped into that equity to a large extent and we remodeled the house, which it was certainly a money mistake because then with the housing market drop, we went underwater. We had pulled out too much money and we went underwater. And that has been a learning situation that I will not repeat. So that is why it is a favorite money mistake because I’ve definitely learned from it. I’m not gonna do it again. But at the same time, we got to live in a renovated home. That was pretty nice at the time too. So , it was a mistake, but I enjoyed it.

Neela (36:12):

I feel like we’re gonna have to start recording the number of money mistakes that are related to primary homes. Every mistake.

Lara (36:19):

Mary Beth (36:20):

That’s true. Just for data. Yeah. Okay. Fill in the blank. If money were easy…

Lara (36:29):

Everyone would be rich.

Mary Beth (36:30):

Ooh, I like that. Yeah. Love it. That’s a great one. So great.

Lara (36:36):

Mm-hmm.

Mary Beth (36:38):

Okay. Lara, tell our listeners how they can contact you or where they can find you.

Lara (36:42):

Wonderful. Well, you can find me on the AbacusWealth.com website and you can find my information up there, but please feel free to email me at Lara@AbacusWealth.com.

Mary Beth (36:59):

Thank you so much for being here. This was such a wonderful conversation and I think just so actionable for those that are going through this process. Really appreciate it.

Lara (37:08):

Thank you so much for having me. You brought me in for a topic that I’m passionate about for personal and career reasons, and I loved being here, so thanks for having me.

Mary Beth (37:19):

Thank you.

Neela (37:20):

Thank you. Thank you for listening to today’s episode of If Money Were Easy. If you’re looking for more information on how you can expand what’s possible with your money, head to AbacusWealth.com. That’s AbacusWealth.com for more analysis and resources created by our team.